In an earlier post, I described what Payers need to know to create high performance APMs.
This post focuses on the Providers.
For years we’ve known that healthcare spending in the United States is on an unsustainable trajectory. In 2015 as part of the Affordable Care Act, HHS created the Health Care Payment Learning & Action Network (HCP-LAN). This is public-private partnership whose goal is to accelerate this transition from Fee-for-Service (FFS) to Alternative Payment Models (APMs), models which reward quality care, lower costs and improved health. HCP-LAN pursues this goal by disseminating knowledge and best practices for designing and implementing APMs.
In April, HCP-LAN published their “Roadmap for Driving High Performance in Alternative Payment Models”. The Roadmap is the product of research and interviews with 13 provider organizations and 9 payers who collectively participate in 10 successful population-based and episode-based payment APMs at national and regional levels across the country. The Roadmap provides real-world proven guidance, examples and promising practices from these APMs to organizations who are thinking about or currently building their own APMs.
The Roadmap covers 3 major categories; APM Design, Payer-Provider Collaboration and Person-Centered Care. Among the many promising practices called out in the report, here are 5 major practices that the report highlights for Providers:
1. Plan Design/APM Investments:
The Roadmap reports that in many successful APMs, payer organizations have provided financial support to help investment by providers transitioning to a new reimbursement model. A specific challenge for providers is to quickly identify how to become self-sustaining as an APM and not reliable on these up-front investments. The up-front costs should not be invested in a manner that sets-up an expectation of regular distributions or payments from the APM without a plan to achieve savings on an on-going basis. In some cases, so as not to be dependent on payers, provider organizations turn within and request that providers ante-up a membership deposit which can act as an up-front cash infusion to the network. If an APM is successful and achieves sufficient cost savings such that savings can be disbursed back to participating providers, then APMs can chose to reimburse initial payments back to their provider participants.
2. Risk Contracts:
APMs are relatively new to many provider organizations. Before agreeing to participate in an APM, providers need to make sure they understand the nature of the APM contract and are comfortable with the risk they are undertaking in joining the APM. Many organizations are dipping their toes into APMs by participating in one-sided or upside-risk-only contracts. These are contracts in which the providers will be rewarded if the APM saves money, but they are not liable if the APM loses money. While these models make sense for providers to start with, CMS and other payers are actively pushing providers to take on two-sided / up- and down-sided risk contracts. The Roadmap calls out key areas that providers need to understand before jumping into these contracts:
a) Financial targets: What are the financial targets for the contracts? How are they calculated? Are there benchmarks which providers will be compared against, and, if so, how are they calculated? Is there a minimum savings threshold that needs to be achieved before any savings can be shared? Are costs from different categories of patients treated the same way or differently in the calculations? Understanding the nuances of these numbers can impact the strategies providers will pursue to beat the financial targets.
b) Measurement criteria: Besides financial criteria, what are the other measurements in the contract and how can providers focus on improving these measurements? How do providers educate their providers and staff on what needs to be done in order to pay attention to these measurements throughout the measurement year?
c) Covered lives: Does the provider have enough patient numbers and sufficient range from a wellness and acuity perspective to provide volume and risk balance? Do the patients have the same acuity as equivalent programs at other provider organizations?
d) Costs relative to regionality: Do providers know where they stand from a cost perspective in their local market or region? Low-cost providers have challenges to continuously beat their own historical low-cost benchmarks. If, however, the low-cost provider’s benchmark is evaluated at a market or regional level, then the provider should find it easier to beat the benchmark because the benchmark will have incorporated competitors’ higher costs.
3. Patient Attribution:
Attribution is the process CMS and other payers use to indicate which patients should be assigned to the APM. Some approaches may use, for example, certain E&M codes, patient visits, patient selection, or maybe even an PCP-auto-assignment process. For MSSP ACOs, CMS attributes patients to a specific ACO, and then provides the ACO with data showing the multiple TINs that have submitted patient claims. CMS leaves it up to the ACO to determine how they want to use this data to link patients to providers. It is a process that may leave providers scratching their heads regarding why certain patients are showing up on their assigned patient lists, and how they can be held accountable for a patient’s care if they’ve rarely seen the patient. Moreover, some ACOs will use the number of assigned patients to a practice or a provider as important inputs into calculations for care management fees or shaved savings distributions. The Roadmap discusses the criticality for providers to understand how this process works and how to reconcile ambiguous assignments. At a minimum, providers should understand on what the attribution based. Provider organizations need to discuss how to manage assignment ties or conflicts, and how to assign patients who many be temporarily receiving the plurality of their care from a specialist rather than a PCP. The Roadmap encourages assignment towards PCPs but indicates that the attribution model needs to one which best fits the provider organization.
4. Patient Data & Relationships:
Payer organizations are typically very adept at claims and data processing. The Roadmap indicates that although payers are able to stratify patients into different risk categories based on their historical and projected care and costs, one big advantage provider organizations have over payers is that they are generally on the front-line with their patients. Providers will usually see and interact with patients on a more on-going and personal basis. Providers will generally know which of their patients are on positive or negative health trajectories, whose habits should reduce patient health risk in the upcoming year, and whose will increase risk. Providers could also be in a better position that the payer to know if a specific intervention or care program would have a positive impact on patients. The Roadmap encourages that patient analysis by payers in the APMs be reviewed and assessed by providers so that they can help validate and improve the results of the analysis. Furthermore, the Roadmap discussed how socio-economic and behavioral data from a patient’s care team can greatly enhance how to provide the most impactful care to high risk patients. Providers are generally in the best position to capture these data. Providers and payers should work collaboratively to combine these data to provide patients with the best possible care plans.
5. Patient Involvement:
The Roadmap discusses how the ‘Principles for Patient- and Family-Centered Payment’ from the Consumer and Patient Affinity Group (CPAG) underscore the importance of APM participants recognizing patients as partners in their own care; adopting measures that are meaningful to patients; ensuring that financial incentives are transparent; improving health equity; and using technology to support patient engagement. APMs need to recognize the importance of involving patients in APM design and implementation. The Roadmap also indicates that most practices used patient surveys and almost half had a patient and family advisory council (PFAC). While participants agreed that both mechanisms were helpful in obtaining feedback that promoted practice changes, some providers thought PFACs were more beneficial because they initiated more meaningful conversations. Also, the Roadmap calls out that it is important to have multiple patient representatives on any advisory board to give patients adequate voices, and ACOs with racially, ethnically, and/or socioeconomically diverse populations should ensure that representatives reflect their populations.
Lastly, a key message in the Roadmap report for both providers and payers is the need to approach APMs with a true collaborative and partnership mentality. APM success requires traditional barriers across organizations to come down, and win-wins to be identified which most importantly also benefit the patient while managing costs. Both sides of the payer-provider relationship will need strong leadership to overcome potential legacy and institutional biases, and enter the APM with a goal of openness, sharing and teamwork which ultimately helps patients and the overall system.
Check out the Roadmap and Success Factors for yourself:
Roadmap: https://hcp-lan.org/apm-roadmap/
Success Factors: http://hcp-lan.org/workproducts/APM-Success-Factors-Report.pdf
